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[2014] ZASCA 127
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Jazz Spirit 12 (Pty) Limited and Others v Regional Land Claims Commissioner: Western Cape and Others (704/2013) [2014] ZASCA 127 (22 September 2014)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case
No: 704/2013
Not
Reportable
In
the matter between
JAZZ
SPIRIT 12 (PTY)
LIMITED
.....................................................................
FIRST
APPELLANT
YAMIV
(PTY)
LIMITED
................................................................................
SECOND
APPELLANT
HEIN
J
BADENHORST
......................................................................................
THIRD
APPELLANT
and
THE
REGIONAL LAND CLAIMS
COMMISSIONER:
WESTERN
CAPE
...........................................................
FIRST
RESPONDENT
SEDICK
SADIEN
.........................................................................................
SECOND
RESPONDENT
EBRAHIM
SADIEN
.........................................................................................
THIRD
RESPONDENT
Neutral
citation:
Jazz Spirit 12 (Pty) Ltd &
others v The Regional Land Claims Commissioner: Western Cape &
others
(704/2013)
[2014] ZASCA 127
(22
September 2014)
Coram:
Bosielo, Saldulker and Swain JJA,
Mocumie and Gorven AJJA
Heard
:
27 August 2014
Delivered:
22 September 2014
Summary
:
Civil appeal against costs – Section 21A(1) of the Supreme
Court Act 59 of 1959 – whether the matter is appealable
–
will the judgment or order sought have practical effect or result –
exceptional circumstances – Section 21A(3)
–application
to intervene – direct and substantial interest –
application for rescission –
Section 35(11)
of the
Restitution
of Land Rights Act 22 of 1994
– is the pending appeal in
respect of the order appealed against.
ORDER
On
appeal from:
Land Claims Court, Cape
Town (Mpshe AJ sitting as court of first instance):
It
is ordered that:
The
appeal is dismissed.
JUDGMENT
Bosielo
JA (Saldulker and Swain JJA, Mocumie and Gorven AJJA concurring):
[1]
At the end of a protracted and bitterly fought legal battle, and on 7
December 2012, the Land Claims Court, Cape Town (Mpshe
AJ) gave
judgment and held as follows:
‘
The
claimants have achieved success in this matter not against the
respondents but against the State. Generally, I would have to
make an
order of costs against the State in favour of the claimants. This I
cannot do. The claimants are funded by the State. I
am inclined to
make no order as to costs.’
[2]
The appellants appeal against this portion of the order with the
leave of the court below. This appeal is therefore confined
to the
costs order.
[3]
In granting leave to appeal, the trial judge held as follows:
‘
The
Land Claims Court is also subject to the basic rule that awarding of
costs is in the discretion of the court. Due to the social
justice
legislation the Land Claims Court is seized with, it is not bound by
the general principle that costs follow the event.
In effect the
tendency and trend in the Land Claims Court is not to order costs
against a party save under exceptional circumstances.’
[4]
What gave rise to this case is a disputed land claim lodged by the
second and third respondents in respect of a farm, Erf 2274
Constantia (the property) also called Sillery Farm. The appellants
opposed this claim. As the dispute regarding the properties
could not
be resolved either by mediation or negotiation, the matter was
referred to the Land Claims Court in terms of
s 14
of the
Restitution
of Land Rights Act 22 of 1994
(the Restitution Act). The trial
commenced during November 2010 until judgment was delivered on 7
December 2012.
[5]
At the end of a protracted trial, the court below found that the
second and third respondents had in fact been deprived of this
property as a result of racially discriminatory laws or practices.
Furthermore, the court below found that the amount of R13 550
paid as the purchase price did not qualify as just and equitable
compensation. Based on the fact that the second and third respondents
had opted for alternative State land and not restoration of the
original land, the court below made an order for Erf 1783 Constantia
to be allocated to the respondent. In the result both parties had
achieved substantial success. As pointed out, the court below
declined to make any order in respect of costs.
[6]
On 8 February 2013 the court below varied its original allocation of
Erf 1783 Constantia and substituted it with a portion of
Erf 142
Constantia. It seems that the court below was under the mistaken
belief that this property was vacant and free to be allocated
and
transferred to the respondents as alternative State land.
[7]
This variation of the order gave rise to an application by the South
African Riding for the Disabled Association, Cape Town
Branch (the
intervening party) for leave to intervene in the appeal and for the
rescission of the judgment of the court below.
This application was
dismissed with costs at the hearing of the appeal. In addition, the
application to rescind the judgment of
the court below was struck off
the roll with costs. The reasons for these orders follow.
[8]
The ground upon which the application was advanced was the undisputed
fact that the intervening party had been occupying Erf
142
Constantia, on the strength of a written lease signed with the
secretary of the School Board, Cape Town on 8 December 1981.
This
property was expropriated for educational purposes by the Cape
Provincial Government during 1966. The intervening party avers
that
it had occupied the property for some 34 years and, that in the
process, it had effected substantial improvements to it with
the
consent of the lessor to the value of R7, 5 million.
[9]
It is common cause that this property was allocated and transferred
to the respondents as alternative State land without the
knowledge or
consent of the intervening party. The intervening party avers that by
virtue of being a tenant of the property, it
is entitled to just and
equitable compensation. No such compensation was paid to the
intervening party. It is for this reason that
the intervening party
seeks leave to intervene in the appeal proceedings before us with the
aim of rescinding the main judgment
of the court below.
[10]
Counsel for the intervening party relied on s 35(11) of the
Restitution Act for the contention that it was entitled to apply
for
the rescission of the judgment on appeal before this court Insofar as
it is relevant this section provides that:
‘
The
court may, upon application by any person affected thereby and
subject to the rules made under section 32, rescind or vary any
order
or judgment granted by it –
(a)
in the absence of the person against whom that
order or judgment was granted;
(b)
which was void from its inception or
was obtained by fraud or mistake common to the parties;
(c)
in respect of which no appeal lies; or
(d)
in the circumstance contemplated in
section 11(5):
Provided
that where an appeal is pending in respect of such order, or where
such order was made on appeal, the application shall
be made to the
Constitutional Court or the Appellate Division of the Supreme Court,
as the case may be.’
[11]
Counsel for the intervening party submitted that, as the judgment, in
respect whereof Erf 142 Constantia was transferred to
the second
respondent, was given in its absence and was obtained by a mistake
common to the parties, it stood to be rescinded.
He submitted further
that as the judgment or order of the Land Claims Court was the
subject of an appeal in this Court, this Court
had the authority to
entertain the application for rescission. He contended further that,
although the section refers to the judgment
or order whilst the
proviso refers to the order only, there is no real distinction
between an order and a judgment as used in the
section. He urged us
to interpret the terms judgment or order liberally to mean one and
the same thing which includes the reasoning,
executive order of the
judgment as well as that for costs. The fact that the appeal before
us is confined to costs only is immaterial
as the order is an
integral part of the judgment, so he contended.
[12]
On the other hand, counsel for the respondents contended that the
proviso to s 35(11) is specific and not open-ended. It requires
a
party which invokes it to show that it is affected by the order
appealed against. He submitted that as the appeal before us is
confined to costs only the intervening party has no interest in the
matter as it is not affected thereby. In essence, he pointed
out that
the part of the judgment on the merits which directly affected the
appellants was not appealed against. Based on this,
he contended
further that as the intervening party conceded that the appeal on
costs will not affect him in any manner, he therefore
cannot rely on
the proviso to s 35(11). Put plainly, the intervening party failed to
show a direct and substantial interest in
the subject of the appeal
on costs, so went the contention.
[13]
The following facts are common cause: that the intervening party was
not a party to the previous proceedings in the court below;
that the
appeal before us is on costs only; that whatever the outcome of the
appeal on costs might be, it will not affect the intervening
party,
and further that the order to be rescinded was not made on appeal by
this Court, nor was it pending before us.
[14]
It is clear from s 35(11) that for the applicant to succeed, it must
prove that the pending appeal is in respect of the order
made by the
court below which the intervening party seeks to rescind. It suffices
to state that the appellant has not succeeded
in meeting this test.
This means that the jurisdictional requirements laid down in s 35(11)
have not been met. The application
to intervene was accordingly
dismissed with costs. Self-evidently this sounded the death-knell for
the application for rescission.
[15]
I now revert to the main appeal against costs. As I alluded to above,
the court below did not deem it necessary to make an
order in respect
of costs. Given the fact that this appeal is on costs only, the
appellants’ legal representative was reminded
of the reluctance
of the appellate courts to interfere with the discretion exercised by
a trial judge in awarding costs, and was
asked whether this appeal
was not hit by the provisions of s 21A(1) and (3) of the Supreme
Court Act 59 of 1959 (the Supreme Court
Act). For ease of reference
this section insofar as it is relevant provides that:
‘
(1)
When at the hearing of any civil appeal to the Appellate Division or
any Provincial or Local Division of the Supreme Court the
issues are
of such a nature that the judgment or order sought will have no
practical effect or result, the appeal may be dismissed
on this
ground alone.
(3)
Save under exceptional circumstances, the question whether the
judgment or order would have no practical effect or result, is
to be
determined without reference to considerations of costs.’
[16]
In an attempt to scale the hurdle presented by s 21A(1), the
appellants’ legal representative sought refuge under s 21A(3)
and submitted that this case presented ‘exceptional
circumstances’ justifying the appeal to be heard. As support
for
this submission, he relied amongst others on the long duration of
the trial which spanned 21 days. In addition, he called in aid
the
failure by the respondents to adopt measures to curtail the length of
the case, the leading of irrelevant witnesses by the
respondents and,
what he described as defamatory or derogatory arguments made by the
respondents about the appellants. Essentially,
he complained about
the manner in which the respondents conducted the trial, which he
submitted contributed to its length with
concomitant huge costs.
[17]
Based on the above, he argued that, given the social importance of
this legislation and the need to address the public quest
for land
restoration as speedily as possible, we should find the respondents’
conduct to have been not only obstructive but,
in the process, to
have exposed the appellants to considerable unnecessary litigation
costs. He contended further that such conduct
should not be
countenanced as it has the potential to defeat the underlying purpose
of the Act. In conclusion, he submitted that
the trial court erred in
not awarding costs against the respondents to mark its displeasure at
the manner in which they conducted
the trial.
[18]
On the other hand, the respondents’ counsel countered that the
facts adduced by the appellants do not qualify as exceptional
or
unusual, uncommon or out of the ordinary as envisaged by the Act.
Based on this he urged us to dismiss the application.
[19]
It is common cause that for the appellants to succeed, they need to
prove ‘exceptional circumstances’ as required
by s
21A(3). What then are ‘exceptional circumstances’? I have
found the following definition in
MV AIS MAMAS Seatrons Maritime v
Owners, MV AIS MAMAS & another
2002 (6) SA 150
(C) at 157E-F
by Thring J to be a useful guide:
‘
I
think that, for the purposes of s 5(5)(
a
)(iv)
the phrase ‘exceptional circumstances’ must, both for the
specific reason mentioned by Jones J and by reason of
the more
general consideration adumbrated by Innes ACJ in
Norwich
Union Life Insurance
Society
v Dobbs
, (supra loc cit), be given a
narrow rather than a wide interpretation. I conclude to use the
phraseology of Comrie J in
S v Mohammed
(supra, loc cit), that, to be exceptional within the meaning of the
subparagraph, the circumstances must be “markedly unusual
or
specially different”; and that, in applying that test, the
circumstances must be carefully examined.’
[20]
This is the test against which the facts or circumstances raised by
the appellant must be measured to determine if they amount
to
‘exceptional circumstances’ for purposes of s 21A(3) of
the Supreme Court Act.
[21]
As already alluded to above, the appellants relied amongst others on
the duration of the trial, the conduct of the respondents’
witnesses and legal representatives and the concomitant huge costs,
as exceptional circumstances. Because the appellants relied
on what
happened during the trial, we had to wade through 30 volumes and 2737
pages of evidence to determine if the circumstances
relied on by the
appellant qualified as ‘exceptional circumstances’ as
required by s 21A(3).
[22]
The appellant sought support for its contention that exceptional
circumstances were present in the decision of this court in
Oudebaaskraal (Edms) Bpk v Jansen van Vuuren
2001 (2) SA 806
(SCA). In this case the appellants had applied in a Water Court for a
permit in terms of the Water Act 54 of 1956, but the application
was
dismissed. The appellants appealed to this court against the
dismissal of the application, but before the appeal was heard,
the
Water Act was repealed in its entirety by
s 163
of the
National Water
Act 36 of 1998
. The respondent contended that this court could
accordingly no longer grant a permit to the appellants and although
there could
still be an appeal against the costs order of the Water
Court, such an appeal would have no practical effect or result and
should
be dismissed in terms of s 21A of the Supreme Court Act 59 of
1959.
[23]
This court held that there was no indication in the
National Water
Act that
the legislature had intended the unfair result of depriving
the appellants of their right of appeal. Accordingly the appellants
had not been deprived of their rights of appeal. This factor
taken together with the fact that considerable costs had been
incurred in the case constituted exceptional circumstances in terms
of s 21A(3) of the Supreme Court Act. The question whether
the
judgment or order of the court of appeal would have a practical
effect or result, could be determined with reference to
considerations
of costs. Accordingly if the appeal succeeded there
would be a practical effect or result. It is therefore clear that a
valid appeal
on the merits had been lodged, but in the interim the
grounds of appeal had been nullified by the repeal of the act upon
which
the appeal was based.
[24]
The facts of the present case are quite clearly distinguishable from
Oudebaaskraal
as to the presence of exceptional circumstances.
The mere fact that the costs are considerable in the present case and
other factors
called in aid do not in themselves constitute
exceptional circumstances justifying the hearing of the appeal.
[25]
I am consequently unable to find that the facts and circumstances on
which the appellants sought to rely are so markedly unusual,
specially different, unusual uncommon, rare or different so as to
constitute ‘exceptional circumstances’ within the
meaning
of s 21A(3). The appeal must accordingly be dismissed.
[26]
What remains is the question of the costs of appeal. Counsel for the
respondents conceded, correctly in my view, that primarily
because we
are dealing with social legislation which has the noble and laudable
objective of addressing the controversial problem
of restitution of
land rights and payment of equitable compensation in appropriate
cases, that it would not be proper to make an
award of costs against
the losing party as is the general rule in ordinary litigation.
[27]
It is crucial for the promotion and maintenance of the rule of law
that parties who approach the courts to resolve their land
disputes
should not be mulcted with costs, particularly where there are no
allegations of wilfulness or vexatiousness as is in
this case.
Undoubtedly s 6 of the Restitution Act places an onerous duty on the
office of the Land Claims Commission to take all
reasonable steps to
ensure that claims that are lodged are well investigated and properly
prepared. Evidently, this is intended
to ensure that all facts
relevant to a particular claim are considered. In addition, it has as
its rationale the fact that many
of the people dispossessed of land
have also been systematically disadvantaged in many other ways and
may well be unlikely to be
in a position to fund any adverse costs
order. Such people might be dissuaded from pursuing the very rights
provided for in the
Restitution Act if costs orders were made in the
ordinary course. If this was their response, it would defeat the very
object of
the Restitution Act. This is, perhaps, an additional reason
for the exceptional circumstances envisaged in s 21A(3) to be
required
to meet an even higher standard in matters concerning costs
arising from the Restitution Act.
[28]
Where there is an unresolved dispute, the Commission is obliged to
refer such dispute to the Land Claims Court for adjudication.
The
investigation and reports by the Commission play a pivotal role in
the ultimate resolution of any ensuing dispute. Self-evidently,
costs
orders might be subversive to the spirit of social justice underlying
the Restitution Act. Dealing with this vexed issue,
Harms ADP stated
the following in
Haakdoringbult Boerdery CC & others v Mphela
& others
2007 (5) SA 596
(SCA) para 76:
‘
That
leaves the costs on appeal. This Court has not yet laid down any
fixed rule and there are judgments that have ordered costs
to follow
the result and others that have made no orders. I believe that the
time has come to be consistent and to hold that in
cases such as this
there should not be any costs orders on appeal absent special
circumstances.’
I
agree and, as a result, we decline to make an order regarding the
costs of the appeal.
[29]
In the result, I make the following order
The
appeal is dismissed.
_________________
L
O BOSIELO
JUDGE
OF APPEAL
Appearances:
For
Appellants : M Schreuder SC (with him JP du Plessis)
Instructed
by:
Du
Plessis, Hofmeyr Malan Inc.; Somerset West
Honey
Attorneys, Bloemfontein
For
Respondents : DJ Jacobs SC
Instructed
by:
State
Attorney; Cape Town
State
Attorney, Bloemfontein
Intervening
Party: SP Rosenberg SC (with him S Wagener
Instructed
by:
Bowman
Gilfillan Inc.; Cape Town